marketview Australian housing markets report Sydney s beaches booming too Dr Andrew Wilson Domain Group senior economist March 2015

Transcription

1 Australian housing markets report Sydney s beaches booming too Dr Andrew Wilson Domain Group senior economist March 2015 Copyright 2015 Dr Andrew Wilson all rights reserved

2 Housing market model Wilson Curve

3 Housing market analysis house price cycle model (Wilson 98) Change points... Define phases peak peak expansion Prices above last peak trough correction Prices below last peak trough recovery Prices above last trough contraction Prices below last trough

4 Recent capital city performance

5 Capital city house price cycle - recent history Correction 2011 Prices fall Affordability falls from higher rates, higher prices PLUS economy down Recovery 2012 Prices rise Affordability improves as rates fall, lower prices AND economy revives Expansion 2013 Price records emerge and consolidate as affordability peaks Historically low rates, still solid economy, CONFIDENCE RESTORED Expansion 2014 Price growth moderates as general economy and low rate impact wane Sydney breaks clear of the pack - other capitals flat or flattening CONFIDENCE TESTED

6 Current state of the national market

7 Current state of the national housing market Expansion consolidated but now moderating All capital city house prices at or near record levels Brisbane, Adelaide and Hobart still on the move with moderate growth Perth prices growth remains modest, but better signs for Canberra - Darwin down Solid finish to all markets on the up except Darwin Peak price growth rates however moderated though 2014 Sydney still booming CONTEXT Mixed-speed economies AND housing markets Markets and market segments patchy Forward indicators and market drivers increasingly mixed and local Lower rates to impact markets affordability, confidence offset by local economy drag

8 Key price drivers

9 The future for house price growth?...as usual depends on the economy Key Drivers Low unemployment and more jobs Rising wages, incomes and profits Lower interest rates Rising stockmarket Confidence

10 Recent prices growth

11 Correction phase prices fall -1.4% -1.7% -4.2% -3.5% -4.0% -4.4% -5.0% -8.0% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

12 Recovery phase prices stabilise and rise 12.6% 4.6% 5.5% 0.8% 0.7% 1.8% -0.4% -4.5% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

13 Expansion phase all markets rising 15.4% 10.0% 9.6% 5.1% 5.0% 5.6% 3.4% 2.2% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

14 Expansion phase growth moderates 14.0% 4.1% 5.9% 4.6% 0.6% 0.9% 2.1% -6.8% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

15 Prices rise over December quarter except Darwin 3.5% 0.6% 1.5% 0.9% 1.0% 1.9% 2.1% -5.9% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

16 Most markets now above or close to previous peaks 34.8% 8.4% 7.9% 3.6% 3.0% 3.2% -2.1% -0.7% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

17 Markets now well above previous price troughs 37.5% 16.6% 16.4% 13.1% 9.5% 8.8% 10.9% 4.9% Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

18 Current capital city price cycle

19 Capital city house price cycle (Wilson Curve) Sydney Melbourne Perth Darwin Brisbane Hobart expansion correction recovery Adelaide Canberra contraction

20 Current capital city growth

21 R I S I N G F A L L I N G Boom Strong Solid Moderate Modest Flat Modest Moderate Solid Strong Bust Housing Market Barometer 4% 4% 3% 2% 1% 0.5% 0% 0.5% 1% 2% 3% 4% 2% 5% Sydney 3.5% Hobart 2.1% Canberra 1.9% Brisbane 1.5% Perth 1.0% Melbourne 0.6% Darwin -5.9% December quarter 2014

22 Sydney the most expensive $872,811 $614,479 $615,280 $588,023 $634,316 $489,128 $469,097 $332,998 Sydney Melbourne Brisbane Adelaide Perth Canberra Hobart Darwin

23 Sydney price cycle

24 Sydney annual house prices still booming 22.2% 15.4% 14.0%

25 Sydney quarterly price growth consistent high trend 3.7% 3.5% 3.3% 2.9%

26 Sydney house price cycle (Wilson Curve) current $872,811 December 2014 peak $647,560 June 2011 expansion correction recovery trough $634,598 December 2011 contraction

27 Sydney unit market

28 Sydney houses versus units in sync but units flatter $950,000 $850,000 $872,811 $750,000 $650,000 $597,668 $550,000 $450,000 $350,000 $250,000 $150, Houses Units

29 Sydney houses versus units December qtr Houses Units Median $872,811 $597,698 Quarter 3.5% 2.9% Year 14.0% 10.4% 5 year 50.1% 39.2% Peak 34.8% 26.5% Trough 37.5% 26.5%

30 Sydney house price cycle (Wilson Curve) Units Houses expansion correction recovery contraction

31 Interest rates and housing markets

32 $85 0,000 $75 0,000 $65 0,000 $55 0,000 $45 0,000 $35 0,000 $25 0,000 8% 7% 6% 5% 4% 3% 2% 1% 0% Interest rates drive the cycle for ALL capitals in sync Rates rise (mining boom 1) Rates fall 08 (GFC) Rates rise (FHOGB mining boom 2) Rates fall (economy fades) Sydney Melbourne Brisbane Adelaide Perth Interest rate

33 Sydney house prices and interest rates underlying relationship 8% 7% 7.25% $900,000 6% $800,000 5% 4.75% $700,000 4% 3% 3.00% $600,000 2% 1% 2.50% $500,000 0% $400,000 Interest Rate Sydney Median

34 Sydney buyer types

35 NSW buyer types market share record high investors (ABS January loans) 59.9% 33.6% 6.5% First home buyers Investors Changeover buyers

36 NSW buyer type annual growth investors best (ABS loans year to Jan 2015 vs ) 34.0% 20.1% 2.9% -2.6% First home buyers Investors Changeover buyers Total

37 National investor market share NSW nearly half (ABS January loans) 45.0% 26.1% 13.9% 8.4% 3.7% NSW VIC QLD SA WA

38 Billions $20 $18 $16 $14 $12 $10 $8 $6 $4 $2 $ Changeover buyers Investors First home buyers

39 FHB local market share - NSW record low (ABS January loans) 18.3% 15.0% 13.3% 11.2% 10.5% 10.5% 11.2% 10.1% 6.5% NSW VIC QLD SA WA TAS ACT NT AUS

40 Billions Sydney prices track NSW loans reliable forward indicator $900,000 $30 $800,000 $25 $20 $700,000 $15 $600,000 $10 $500,000 $5 $400, $0 Sydney median house price NSW housing loans

41 Stable investor share through cycle reflects longer-term investment focus 70.0% $900, % $800, % $700, % $600, % $500, % 45.0% $400, % 37.4% 35.9% $300, % $200, % $100,000 Investor loan share Average investor loan share Sydney median house price

42 Sydney price ranges

43 Price ranges prestige still lagging 36.5% 33.8% 22.2% 15.0% 14.6% 8.2% 4.2% 3.4% -0.3% Budget (up to $815k) Middle ($815k to $2m) Prestige ($2m+) December Qtr Year Peak

44 Sydney house price range cycle (Wilson Curve) Middle Budget Prestige expansion correction recovery contraction

45 Sydney regions

46 Sydney s three tribes merging? $1,900,000 $1,700,000 $1,500,000 Prestige $1,300,000 $1,100,000 $900,000 $700,000 Middle $500,000 $300, Lower North City and East Northern Beaches Inner West Upper North Shore South Canterbury Bankstown West South West Budget

47 Sydney s three tribes merging? Houses Median Dec qtr year Last peak Lower North $1,800, % 12.5% 34.3% 26.3% City and East $1,650, % 7.8% 32.0% 21.8% Northern Beaches $1,315, % 10.0% 34.2% 23.5% Inner West $1,270, % 17.6% 58.8% 42.7% Upper North Shore $1,180, % 21.3% 57.3% 47.5% South $964, % 13.4% 46.5% 33.9% Canterbury Bankstown $770, % 15.8% 58.8% 42.6% West $592, % 15.0% 52.2% 41.0% South West $570, % 18.5% 50.0% 39.8%

48 Sydney house price range cycle (Wilson Curve) Inner west West Canterbury Bankstown South west Upper north City and east expansion Northern beaches Lower north correction recovery contraction

49 Northern beaches and lower north suburbs

50 Northern beaches top selling suburbs (6 months December 2014) Houses Sold Median Listings per sale 6 month 1 year 5 year Seaforth 69 $1,605, % 7.5% 27.5% Mona Vale 65 $1,150, % -0.9% 35.1% Avalon 60 $1,282, % 6.9% 25.7% Warriewood 60 $1,075, % 15.6% 36.1% Manly 52 $2,010, % 8.6% 30.9% Balgowlah 52 $1,503, % 25.8% 33.5% Cromer 52 $1,073, % 12.7% 41.2% Beacon Hill 51 $1,110, % 18.1% 37.7% Allambie Heights 49 $1,185, % 19.1% 38.8% Dee Why 46 $1,088, % 17.5% 40.4%

51 Northern beaches top selling suburbs (6 months December 2014) Units Sold Median Listings per sale 6 month 1 year 5 year Dee Why 283 $595, % 6.3% 32.2% Manly 202 $900, % 2.9% 41.7% Warriewood 98 $697, % 13.9% 9.1% Narrabeen 79 $646, % 11.6% 29.2% Collaroy 73 $665, % 7.4% 20.9% Manly Vale 66 $653, % 24.5% 42.7% Freshwater 62 $632, % 14.0% 38.1% Queenscliff 59 $775, % 7.6% 33.6% Balgowlah 54 $763, % 18.0% 24.5% Brookvale 54 $603, % 14.1% 22.0%

52 Lower north top selling suburbs (6 months December 2014) Houses Sold Median Listings per sale 6 month 1 year 5 year Mosman 197 $2,675, % 16.3% 29.4% Hunters Hill 68 $1,982, % 27.7% 32.2% Willoughby 62 $1,669, % 22.3% 33.5% Gladesville 55 $1,350, % 5.5% 49.7% Lane Cove 54 $1,497, % 15.1% 39.3% Cremorne 52 $1,527, % 11.9% 5.5% Naremburn 46 $1,622, % 21.5% 64.7% Northbridge 45 $2,230, % 0.2% 17.4% Lane Cove North 37 $1,315, % 5.2% 48.6% Greenwich 36 $1,930, % 9.7% 18.4%

53 Lower north top selling suburbs (6 months December 2014) Units Sold Median Listings per sale 6 month 1 year 5 year Mosman 264 $765, % 1.0% 35.4% Neutral Bay 123 $750, % 2.7% 42.2% Lane Cove North 121 $605, % 3.4% 37.5% Cremorne 117 $762, % -4.2% 27.0% North Sydney 113 $720, % 12.5% 64.6% St Leonards 95 $789, % 7.3% 43.5% Wollstonecraft 90 $782, % 7.9% 29.8% Lane Cove 90 $657, % -5.0% 46.1% Gladesville 67 $575, % -1.0% 45.0% Artarmon 65 $710, % 10.1% 35.2%

54 Sydney rental market

55 Sydney house rents versus house prices $900,000 $600 $800,000 $500 $700,000 $400 $600,000 $300 $500, $200 House price House rent

56 Sydney unit rents versus unit prices $650,000 $550 $600,000 $500 $550,000 $450 $500,000 $400 $450,000 $350 $400,000 $300 $350,000 $250 $300, $200 Unit price Unit rent

57 Sydney house rents versus unit rents $550 $500 $450 $400 $350 $300 $250 $ Unit rent House rent

58 Sydney house yields versus unit yields 6.0% 5.5% 5.0% 4.5% 4.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% House yield Unit yield

59 Capital city rental markets (December qtr 2014) Houses Rent Qtr change Annual change Yield Vacancy rate (January) Sydney $ % 4.0% 4.00% 1.8% Melbourne $ % 0.0% 4.08% 2.0% Brisbane $ % 0.0% 5.02% 2.1% Adelaide $ % 0.0% 4.81% 1.3% Perth $ % -6.3% 4.57% 2.4% Canberra $ % -2.2% 4.55% 1.3% Darwin $ % -5.7% 5.21% 1.3% Hobart $ % 3.2% 5.44% 1.0%

60 Capital city rental markets (December qtr 2014) Units Rent Qtr change Annual change Yield Vacancy rate (January) Sydney $ % 2.0% 4.48% 2.2% Melbourne $ % 2.9% 4.60% 3.4% Brisbane $ % -1.3% 5.14% 3.0% Adelaide $ % 1.8% 5.27% 2.0% Perth $ % -2.5% 4.92% 2.9% Canberra $ % -4.9% 5.28% 1.7% Darwin $ % -3.5% 5.68% 3.6% Hobart $ % 3.8% 5.65% 4.5%

61 Northern beaches top rental suburbs ( 6 months December 2014) Houses Vacancies Rent 6 month change Annual change Yield Avalon 92 $ % -14.7% 3.2% Seaforth 71 $1, % 2.6% 3.8% Mona Vale 64 $ % 1.5% 3.8% Balgowlah 60 $ % -4.0% 3.4% Newport 57 $ % 2.4% 3.4% Manly 56 $1, % 12.5% 3.3% Warriewood 51 $ % 10.0% 4.3% Freshwater 49 $1, % -9.5% 3.6% Narraweena 48 $ % 7.1% 3.5% Dee Why 46 $ % 11.6% 3.9%

62 Northern beaches top rental suburbs ( 6 months December 2014) Units Vacancies Rent 6 month change Annual change Yield Manly 679 $ % 1.5% 3.8% Dee Why 659 $ % 2.0% 4.4% Narrabeen 216 $ % 10.0% 4.4% Freshwater 182 $ % 4.0% 4.3% Queenscliff 151 $ % 5.7% 4.0% Collaroy 148 $ % 6.9% 4.2% Balgowlah 137 $ % 6.5% 3.9% Fairlight 132 $ % 0.0% 4.0% Manly Vale 120 $ % 8.0% 4.0% Mona Vale 118 $ % 0.0% 3.3%

63 Lower north top rental suburbs ( 6 months December 2014) Houses Vacancies Rent 6 month change Annual change Yield Mosman 187 $1, % 0.0% 3.1% Gladesville 72 $ % -1.1% 2.7% Cremorne 69 $1, % 11.1% 3.4% Neutral Bay 69 $ % 3.3% 3.3% Cammeray 67 $ % 2.3% 2.9% Lane Cove 62 $ % 6.7% 2.8% Lane Cove North 57 $ % 18.0% 3.2% Crows Nest 55 $ % -6.0% 3.4% Willoughby 52 $ % 8.1% 2.9% Artarmon 47 $ % 10.9% 2.2%

64 Lower north top rental suburbs ( 6 months December 2014) Units Vacancies Rent 6 month change Annual change Yield Mosman 735 $ % 1.9% 3.7% Neutral Bay 513 $ % 4.8% 3.8% North Sydney 439 $ % 3.6% 4.1% Cremorne 413 $ % 2.7% 3.9% St Leonards 413 $ % 2.7% 3.8% Wollstonecraft 312 $ % 4.5% 3.8% Artarmon 302 $ % 2.9% 3.9% Lane Cove North 279 $ % 3.2% 4.1% Kirribilli 232 $ % -4.8% 4.3% Lane Cove 207 $ % 2.0% 4.0%

65 Sydney key market drivers

66 Sydney ABS dwelling approvals 35,660 38,252 27,458 24,683 24,878 18,232 9,226 10,977 13, Houses Units Total

67 Sydney ABS dwelling approvals - undersupply drives market 45,000 40,000 38,252 35,000 30,000 25,000 20,000 15,000 10,000 5,

68 Sydney ABS January dwelling approvals - more units 3,596 3,105 2,773 2, Houses Units Total Jan-14 Jan-15

69 New South Wales overseas migration drives local housing markets (ABS financial year) 66,972 73,300 58,

70 Sydney population growth drives prices (ABS financial year) 2.5% $800, % 1.7% $700, % $600, % 0.5% $500, % $400,000 Population growth House prices

71 Prestige markets versus All Ords 7000 $1,950, $1,450, $950, $450, $50, Sydney Melbourne Brisbane All Ords 0

72 Sydney prestige versus All Ords $2,100, $1,900, $1,700, $1,500, $1,300, $1,100,000 $900, $700, $500, Sydney Prestige All Ords

73 Sydney prestige regions versus All Ords $2,000, $1,800, $1,600,000 $1,400, $1,200, $1,000,000 $800, $600, $400,000 $200, $ Lower North City and East Northern Beaches All Ords

74 Sydney economic performance

75 Sydney jobs rising 41,613 new jobs over year (ABS February) 2,500,000 2,459,824 2,450,000 2,400,000 2,393,462 2,418,212 2,350,000 2,332,763 2,351,617 2,300,000 2,282,176 2,250,000 2,200,000 2,150,000 2,100,

76 Sydney jobless still low (ABS February) 6.5% 6.0% 5.5% 5.4% 5.1% 5.5% 5.5% 5.8% 5.8% 5.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0%

77 Sydney in work stabilising - absorbing strong migration? (ABS February) 67.0% 66.5% 66.0% 65.7% 66.1% 66.0% 66.2% 65.8% 65.8% 65.5% 65.0% 64.5% 64.0% 63.5% 63.0%

78 National economic performance

79 National turnaround? Sydney still the best February ABS jobless rate Trend Sydney 5.8% 5.8% Melbourne 7.3% 6.6% Brisbane 6.7% 6.5% Adelaide 7.5% 7.1% Perth 6.3% 6.4% Hobart 8.0% 6.8% Canberra 3.6% 5.4% Darwin 3.3% 3.1%

80 NSW retail spending top performer (ABS growth year to January 2015) 5.7% 4.2% 4.0% 2.9% 3.1% 2.4% 2.4% 2.5% -2.0% NSW VIC QLD SA WA TAS NT ACT AUS

81 NSW economy on the rise state final demand (ABS rolling annual quarters Dec 2014) 6% 5% 4% 4.0% 3% 2% 1% 0%

82 NSW economy best performer state final demand (ABS Dec qtr 2014 vs Dec qtr 2013) 6.2% 4.0% 2.7% 1.9% 1.6% 1.5% -1.7% -3.5% NSW VIC QLD SA WA TAS NT ACT

83 Economic outlook

84 Economic outlook 2015 Mixed national economic outlook Pessimism outweighing optimism - future cloudy- but a glimmer of hope? Reserve Bank increasingly bearish on near-term direction of economy International economy wavering? Growth in China remains relatively strong but signs of fading international economy US economy continues to slowly revive but real growth (wages) still too low AUD to fall as USD rises Mixed results for local economies NSW solid growth trend top performer as mixed economy spreads the load VIC in transition as manufacturing base wanes but building and services holding up QLD up as dollar falls - strong exporter, tourism, population growth confidence up slowly SA showing early signs of revival but will be a gradual and lengthy process WA still OK with population surge but mining building boom over and lower iron ore prices TAS showing early signs of revival but remains national underperformer NT boom resources economy creaking under population surge but set to resume growth

85 Economic drivers - rates, dollar, wages, profits all low and falling - but shares up Interest rates remaining at 60 year low Downward bias until jobless falls below 6% - less stimulus capacity from record low rates deflation risk Mortgage costs falling as banks compete for market share but still at 2009 rates Rate cuts likely to continue through economy needs more stimulus watch the currency Stockmarket rising with lower dollar but hostage to global forces Investors shift to shares and increased international investment with lower dollar Solid growth upside as still 10% below 2007 peak, unlike other exchanges at or near highs Lower dollar and looming deflation Imports more expensive, living standards fall, spending and investment decline Wages and profits subdued in low inflation economy places lid on house price growth despite rate cuts Government spending constrained by high deficit - horror budget(s) Retail sales, building, profits, sentiment and exports mixed, but not good enough

86 Sydney housing market outlook

87 Sydney housing market outlook clearly still the best capital Market to remain robust and consistent as key drivers continue to hold up Changeover buying resilient as rising prices offset by lower rates, high confidence and enthusiasm Investors to remain active - yields low but stable as fundamentals hold - better than deposit rates Prestige rising with shares and FHB s to trickle back into market from low base Historically low interest rates to keep falling with banks competing for market share Top performing local economy as wealth effect and population rises Jobless levels remain relatively low as house price growth fuels wealth effect downstream Increased dwelling construction to continue more unit approvals - creating jobs Rising population through overseas migration and local jobseekers Pressure remains on rental market with vacancy rates tight Chronic house and land shortages to continue to drive underlying prices growth Sydney prices growth to moderate from last year but still up by a solid 7-10% The northern beaches and lower north still strong with prices up by 7%

88 National housing market outlook

89 R I S I N G F A L L I N G Boom Strong Robust Solid Moderate Flat Moderate Solid Robust Strong Bust Housing Market Barometer 12% 4% 8% 6% 4% 2% 0% 1% 2% 3% 4% 5% 0% 2% Sydney 8% Brisbane 6% 2015 forecasts Melbourne, Adelaide, Hobart 4% Perth, Darwin, Canberra 2% 5%

90 Sydney local housing market outlook

91 R I S I N G Boom Strong Robust Solid Housing Market Barometer 12% 4% 8% 6% 4% Budget, Middle 10% Prestige 5% 2015 forecasts Moderate 2% F A L L I N G Flat Moderate Solid Robust Strong Bust 0% 1% 2% 3% 4% 5% 0% 2% 5%

92 R I S I N G Boom Strong Robust Solid Housing Market Barometer 12% 8% 6% 4% 4% 2015 forecasts inner west, upper north 10% south west, west, Canterbury Bankstown, south 8% northern beaches, lower north, city and east 7% Moderate 2% F A L L I N G Flat Moderate Solid Robust Strong Bust 0% 1% 2% 3% 4% 5% 0% 2% 5%

93 Sydney auctions reliable and timely market indicator

94 Sydney clearance rate reflects prices growth reliable weekly indicator 80% $900,000 70% 60% $800,000 50% $700,000 40% 30% $600,000 20% $500,000 10% 0% $400,000 House price ACR

95 Sydney auction volumes also reflects prices growth reliable weekly indicator $1,000,000 $900, $800, $700,000 $600, $500, $400,000 $300, $200, $100,000 Auctions House price 4 per. Mov. Avg. (Auctions)

96 Northern beaches rate also reflects prices growth reliable weekly indicator 80% $1,500,000 70% $1,400,000 60% $1,300,000 50% $1,200,000 $1,100,000 40% $1,000,000 30% $900,000 20% $800,000 10% $700,000 0% $600,000 Median house price Clearance rate

97 Lower north rate also reflects prices growth reliable weekly indicator 90% $1,900,000 80% $1,800,000 70% $1,700,000 60% 50% $1,600,000 $1,500,000 $1,400,000 40% 30% 20% $1,300,000 $1,200,000 $1,100,000 10% $1,000,000 0% $900,000 Median house price Clearance rate

98 February clearance rates at record levels 86.4% 85.8% 85.1% 82.3% 81.7% 80.7% 75.1% 73.0% 71.8% Inner West Upper North Shore Lower North South City and East Northern Beaches West Canterbury Bankstown South West

99 Northern beaches February clearance rates rising 80.7% 76.9%

100 Northern beaches February listings rising

101 Lower north February clearance rates rising 85.1% 83.0%

102 Lower north February listings rising

103 Super Saturday March 28 th clearance rates at record levels 93.8% 90.3% 89.9% 89.7% 89.2% 88.1% 84.1% 79.5% 79.2% 75.4% 66.7% City and East Northern Beaches South Upper North Shore Lower North Inner West Canterbury Bankstown South West North West West Central Coast

104 The rising tide

105 House price history lesson Australian housing markets are historically trend-linked Sydney Melbourne Brisbane Adelaide Perth

106 Rising regional tide Lower North City and East Northern Beaches Inner West Upper North Shore South Canterbury Bankstown West South West

107 A rising tide lifts all boats - in time Economies Employment Incomes Population growth Prosperity Confidence House prices Monolithic Australian economy and housing market

108 Australian residential property s best friend (the Wilson curve) Secure reliable long-term tax-enhanced capital growth

109 Sydney affordability debate

110 Falling repayments enable prices growth (Reserve Bank indicator rate, 30 year variable, ABS) $900,000 $850,000 $617 $872,811 $650 $800,000 $579 $561 $600 $750,000 $530 $550 $700,000 $650,000 $502 $500 $600,000 $450 $550,000 $410 $500, $400 NSW average repayment Sydney median Overall average repayment

111 Incomes rise, repayments fall, affordability improves and prices rise (ABS) $900,000 45% $850,000 $800, % 38.9% 40% $750, % 35% $700, % $650, % 28.1% 30% $600,000 25% $550,000 $500, % NSW loan proportion of Sydney income Sydney median Average NSW loan proportion of Sydney income

112 Incomes, prices, loans which is the effective affordability benchmark? (ABS) % % Income factor at record levels? % % 35.0% % 30.0% % But loan proportion still below average! % 20.0% Weekly Sydney income as a factor of Sydney price Average income as a proportion of price NSW loan proportion of Sydney income Average loan proportion of income

113 Sydney home owners higher interest rate vulnerability just 4.3% (ABS) 4.3% 31.7% 32.6% 31.4% Non-owners Repayments 30% or less than income Outright owners Repayments 30% or more than income

114 Australian property market analysis - Domain Marketview Where do you go to find out what's really happening in your housing market? Buy? Sell? Hold? or Rent? Expert real-time insights into the current state and future prospects of your housing market Coming soon Domain Marketview on the Domain website

115 Australian property market analysis If you require any further information regarding Australian property market analysis I may be contacted by at andrewwilson@domain.com.au or phone For all the real-time housing market insights follow me on twitter Listen to me on Radio 2UE Saturdays to 1pm

116 Thank you